WWW.EXFILE.COM -- PERFORMANCE HEALTH -- 16029 -- EXHIBIT 10-130 TO FORM 10-Q


    EXHIBIT
10.130

     

     

    THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).  THE SECURITIES MAY
NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER SAID ACT, OR AN OPINION OF COUNSEL IN FORM,
SUBSTANCE AND SCOPE CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS
THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR UNLESS SOLD PURSUANT TO RULE
144 UNDER SAID ACT.

     

    FORM
OF UNSECURED NON-CONVERTIBLE PROMISSORY NOTE

    
    

     

    
      	

              Trenton,
      New Jersey

              ___________,
      2008 

            	
              $________

            


    

     

                                                                                                                                  

    FOR VALUE RECEIVED, PERFORMANCE HEALTH TECHNOLOGIES,
INC., a Delaware corporation (hereinafter called the “Borrower”), hereby
promises to pay to the order of _________________or registered assigns (the
“Holder”) the sum of _________, on ________________, 2008 [180 days] (such date,
the “Maturity Date”), and to pay interest on the unpaid principal balance hereof
at the rate of twelve percent (12%) per annum from the date of this Note (the
“Issue Date”) until the same becomes due and payable, whether at maturity or
upon acceleration or by prepayment or otherwise.  Interest shall
commence accruing on the Issue Date, shall be computed on the basis of a 365-day
year and the actual number of days elapsed and shall be payable in cash on the
Maturity Date.

     

    All
payments due hereunder shall be made in cash at such address as the Holder shall
hereafter give to the Borrower by written notice made in accordance with the
provisions of this Note.

     

    Whenever
any amount expressed to be due by the terms of this Note is due on any day which
is not a business day, the same shall instead be due on the next succeeding day
which is a business day.  As used in this Note, the term “business
day” shall mean any day other than a Saturday, Sunday or a day on which
commercial banks in the city of New York, New York are authorized or required by
law or executive order to remain closed.  Each capitalized term used
herein, and not otherwise defined, shall have the meaning ascribed thereto in
that certain Subscription Agreement between the Holder and the Borrower to which
this Note relates, as amended from time to time, pursuant to which the Holder
subscribed to purchase this Note (the “Subscription Agreement”).

     

    This Note
is free from all taxes, liens, claims and encumbrances with respect to the issue
thereof and shall not be subject to preemptive rights or other similar rights of
shareholders of the Borrower and will not impose personal liability upon the
Holder thereof.

     

    The
following terms shall apply to this Note:

     

    1.           RIGHT
OF REDEMPTION

    


    A.           Optional
Redemption.  At any time prior to the Maturity Date the
Borrower at its option shall have the right, with ten (10)  business
days advance written notice (the “Optional Redemption Notice”), to redeem a
portion or all amounts outstanding under this Note in an amount equal to the
principal amount outstanding being redeemed and accrued interest thereon (the


     

    
      
        
        

      

      
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    “Optional
Redemption Amount”).  The Borrower shall deliver to the Holder the
Optional Redemption Amount on the tenth (10th)
business day after the Optional Redemption Notice (the “Optional Repayment
Date”).

    


    In the
event that the Borrower redeems a portion of the amount outstanding under this
Note, the Borrower shall be entitled to an off-set of the amount of principal
and accrued interest due equal to the amount of principal and accrued interest
redeemed.

    


    B.           Mandatory
Redemption.  At any time prior to the Maturity Date the
Borrower shall upon a Mandatory Redemption Event (as herein defined) have the
obligation, with ten (10)  business days advance written notice (the
“Mandatory Redemption Notice”), to redeem all amounts outstanding under this
Note in an amount equal to 100% of the principal amount outstanding and accrued
interest thereon (the “Mandatory Redemption Amount”).  The Borrower
shall deliver to the Holder the Mandatory Redemption Amount on the tenth
(10th)
business day after the Mandatory Redemption Notice.  The “Mandatory
Redemption Event” shall be defined as the date on which the Company has closed
upon equity financings grossing an aggregate of $1 million commencing upon the
Issue Date and ending upon the Maturity Date.

    


    2.            EVENTS
OF DEFAULT

    


    If any of
the following events of default (each, an “Event of Default”) shall
occur:

     

    A.           Failure to Pay Principal or
Interest.  The Borrower fails to pay the principal hereof or
interest thereon when due on this Note, whether at maturity, upon acceleration
or otherwise;

     

    B.           Receiver or
Trustee.  The Borrower or any subsidiary of the Borrower shall
make an assignment for the benefit of creditors, or apply for or consent to the
appointment of a receiver or trustee for it or for a substantial part of its
property or business, or such a receiver or trustee shall otherwise be
appointed;

     

    C.           Bankruptcy.  Bankruptcy,
insolvency, reorganization or liquidation proceedings or other proceedings for
relief under any bankruptcy law or any law for the relief of debtors shall be
instituted by or against the Borrower or any subsidiary of the Borrower which
remains unvacated, unbonded or unstayed for a period of thirty (30)
days;

     

    then,
upon the occurrence and during the continuation of any Event of Default
specified in Section 2.A, at the option of the Holders of a majority of the
aggregate principal amount of the outstanding Notes issued in connection with
the Offering pursuant to which this Note was issued, exercisable through the
delivery of written notice to the Borrower by such Holders (the “Default
Notice”), and upon the occurrence of an Event of Default specified in Section
2.B or C, the Notes shall become immediately due and payable (the “Mandatory
Prepayment Date”) and all amounts payable hereunder shall immediately become due
and payable, all without demand, presentment or notice, all of which hereby are
expressly waived, together with all costs, including, without limitation, legal
fees and expenses, of collection, and the Holder shall be entitled to exercise
all other rights and remedies available at law or in equity.

     

    


    
      
        
        

      

      
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    3.           MISCELLANEOUS

    


    A.           Failure or Indulgence Not
Waiver.  No failure or delay on the part of the Holder in the
exercise of any power, right or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such power, right or
privilege preclude other or further exercise thereof or of any other right,
power or privileges.  All rights and remedies existing hereunder are
cumulative to, and not exclusive of, any rights or remedies otherwise
available.

     

    B.           Notices.  Any
notice herein required or permitted to be given shall be in writing and may be
personally served or delivered by courier or sent by United States mail and
shall be deemed to have been given upon receipt if personally served (which
shall include telephone line facsimile transmission) or sent by courier or three
(3) days after being deposited in the United States mail, certified, with
postage pre-paid and properly addressed, if sent by mail.  For the
purposes hereof, the address of the Holder shall be as shown on the records of
the Borrower; and the address of the Borrower shall be 427 River View Plaza,
Trenton, NJ 08611 facsimile number: (609) 656-0869.  Both the Holder
and the Borrower may change the address for service by service of written notice
to the other as herein provided.

     

    C.           Amendments.  This
Note and any provision hereof may only be amended by an instrument in writing
signed by the Borrower and the Holder.  The term “Note” and all
reference thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as
so amended or supplemented.

     

    D.           Assignability.  This
Note shall be binding upon the Borrower and its successors and assigns, and
shall inure to be the benefit of the Holder and its successors and
assigns.  Each transferee of this Note must be an “accredited
investor” (as defined in Rule 501(a) of the Securities
Act).  Notwithstanding anything in this Note to the contrary, this
Note may be pledged as collateral in connection with a bona fide margin account
or other lending arrangement, subject to all applicable federal and state
securities laws.

     

    E.           Governing
Law.  THIS NOTE SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES
OF CONFLICT OF LAWS.  THE BORROWER HEREBY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK
WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS NOTE, THE AGREEMENTS ENTERED INTO
IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BOTH
PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH SUIT OR PROCEEDING.  BOTH PARTIES FURTHER AGREE
THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED
IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR
PROCEEDING.  NOTHING HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.  BOTH PARTIES AGREE THAT
A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT
OR IN ANY OTHER LAWFUL MANNER.  THE PARTY WHICH DOES NOT PREVAIL IN
ANY DISPUTE ARISING UNDER THIS NOTE SHALL BE RESPONSIBLE FOR ALL FEES AND
EXPENSES, INCLUDING ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY IN
CONNECTION WITH SUCH DISPUTE.

     

    
      
        
        

      

      
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    F.           Denominations.  At
the request of the Holder, upon surrender of this Note, the Borrower shall
promptly issue new Notes in the aggregate outstanding principal amount hereof,
in the form hereof, in such denominations of at least $1,000 as the Holder shall
request.

     

     G.           No Preemptive
Rights.  Except as provided herein no Holder of this Note shall
be entitled to rights to subscribe for, purchase or receive any part of any new
or additional shares of any class, whether now or hereinafter authorized, or of
bonds or Notes, or other evidences of indebtedness convertible into or
exchangeable for shares of any class, but all such new or additional shares of
any class, or any bond, Notes or other evidences of indebtedness convertible
into or exchangeable for shares, may be issued and disposed of by the Board of
Directors on such terms and for such consideration (to the extent permitted by
law), and to such person or persons as the Board of Directors in their absolute
discretion may deem advisable.

     

     IN WITNESS WHEREOF, Borrower
has caused this Note to be signed in its name by its duly authorized
officer.

    


    PERFORMANCE
HEALTH TECHNOLOGIES, INC.

    


    


    


    By: 
______________________________

           
Name:

           
Title:

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
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